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Thursday, October 21, 2010

What happens when procurement is entrusted to politicians

This is the latest entry in a saga that has been previously reported in this blawg here and here.

Report: Top New York officials guilty of favoritism
A scathing report from the state Inspector General's Office paints an extraordinary picture of Gov. David Paterson, his aides and top Democratic legislative officials working in conjunction with well-paid lobbyists and AEG officials to award the contract to the company.

Inspector General Joseph Fisch knocked a 2008 law that put the decision-making in the hands of the governor and legislative leaders, saying, "the statute removed lobbying restrictions and allowed campaign cash to flow to the decision makers."

Fisch described a "political free-for-all" in which confidential information was leaked to AEG officials and campaign contributions were made to key lawmakers to help AEG, which was run by influential businessmen and New York City community leaders.

AEG, founded by Karl O'Farrell, an Australian investor, was granted the contract in January, but under public scrutiny and news reports about the shady deal, the contract was rescinded in March. A new bidding process was started and in August the contract was awarded for $380 million to Genting New York, a Malaysian-based company.

The report said Senate Democratic Leader John Sampson in November 2009 "disclosed one or more confidential internal Senate analyses" of the competing bids to Andrews.

Sampson claimed he was unaware the information was confidential.

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